Bill Text: NJ SR139 | 2016-2017 | Regular Session | Introduced
Bill Title: Opposes elimination of federal tax deduction for property taxes contained in Trump administration's recent federal tax reform proposal.
Spectrum: Partisan Bill (Democrat 18-0)
Status: (Passed) 2018-01-05 - Filed with Secretary of State [SR139 Detail]
Download: New_Jersey-2016-SR139-Introduced.html
Sponsored by:
Senator PAUL A. SARLO
District 36 (Bergen and Passaic)
Senator LORETTA WEINBERG
District 37 (Bergen)
Co-Sponsored by:
Senators Lesniak, Pou, Madden, B.Smith, Greenstein, Diegnan, Turner, Cruz-Perez, Ruiz, Gill, Bell, Beach, Rice, Cunningham, Stack and Codey
SYNOPSIS
Opposes elimination of federal tax deduction for property taxes contained in Trump administration's recent federal tax reform proposal.
CURRENT VERSION OF TEXT
As introduced.
A Senate Resolution opposing the elimination of the federal tax deduction for property taxes contained in the Trump Administration's recent federal tax reform proposal.
Whereas, On September 27, 2017 President Donald Trump and the "Big Six" work group of congressional and White House tax reform principals unveiled a proposal, the "Unified Framework for Fixing our Broken Tax Code," to reform the federal tax system for individual and business taxpayers; and
Whereas, This proposal is unified by four key principals that aim to simplify the federal tax code, give American workers a pay raise by cutting taxes, increase competitiveness for American businesses by reducing corporate tax rates, and bring back trillions of dollars that are currently kept offshore to reinvest in the American economy; and
Whereas, An important component of the proposal's efforts to simplify the federal tax code is a recommendation to Congress to eliminate most itemized deductions and personal exemptions that are currently allowed to be claimed by individuals in favor of a larger, more generous standard deduction totaling $12,000 for individuals and $24,000 for married couples filing jointly; and
Whereas, In eliminating most itemized deductions and personal exemptions in favor of a larger standard deduction, the recommendation provides for an end to a long-standing federal deduction that permits taxpayers to reduce their federal taxable gross income by the amount of property taxes and either income or sales taxes paid to state and local jurisdictions during the taxable year; and
Whereas, The elimination of the federal deduction for state and local taxes would generate federal revenue needed to pay for the tax reform, but would do so at a significant cost for New Jersey residents who pay on average the highest property taxes among residents of all other states and, as a result, rely on the tax benefits of the federal deduction more heavily than residents of most other states; and
Whereas, According to a recent analysis of the federal deduction conducted by a policy professor at New York University, in tax year 2015 New Jersey counties made up 10 of the 20 counties in the United States with the highest percentage of residents claiming the deduction for state and local taxes on their federal tax deductions. The analysis indicates that these counties include: Hunterdon, Bergen, Morris, Sussex, Somerset, Monmouth, Union, Warren, Middlesex, and Gloucester; and
Whereas, For many of the residents of these counties as well as residents of other counties throughout the State, the elimination of the federal deduction for state and local taxes would result in the payment of higher federal taxes, dependent on the income thresholds that are to be determined for the tax rates proposed under the federal tax reform plan and the current mix of personal exemptions, deductions, and credits currently claimed by each taxpayer; and
Whereas, The additional tax that would be required to be paid by these New Jersey taxpayers as a result of the elimination of the deduction is unfair given that the additional tax required to be paid under the tax reform proposal amounts to a double tax or a federal tax on top of the existing local property taxes that have already been paid by New Jersey homeowners; and
Whereas, The additional tax that would be required to be paid by New Jersey taxpayers as a result of the elimination of the deduction also is unfair given that New Jersey residents already contribute more in taxes than is returned to the State in the form of federal aid; and
Whereas, The tax reform proposal put forth by the Trump Administration would require many New Jersey residents to pay more in tax despite the fact that by some estimates New Jerseyans receive only 48 cents back for each dollar they pay in federal income tax; now, therefore,
Be It Resolved by the Senate of the State of New Jersey:
1. This House opposes the elimination of the federal tax deduction for property taxes contained in the Trump administration's recent federal tax reform proposal.
2. This House respectfully urges the President and Congress to retain an itemized deduction or other similar benefit under the federal tax code for the payment of local property taxes in any tax reform proposal enacted into law in the future considering the significant, negative impact the elimination of the current deduction would have on New Jersey and its residents.
3. Copies of this resolution, as filed with the Secretary of State, shall be transmitted by the Secretary of the Senate to the President and Vice President of the United States, the Majority and Minority Leaders of the United States Senate, the Speaker and Minority Leader of the United States House of Representatives, and each member of Congress elected from this State.
STATEMENT
This resolution expresses the Senate's opposition to the proposed elimination of the federal tax deduction for property taxes contained in the Trump administration's recent federal tax reform proposal, and urges the President and Congress to retain an itemized deduction or other similar benefit under the federal tax code for the payment of local property taxes in any tax reform proposal enacted into law in the future considering the significant, negative impact the elimination of the current deduction would have on New Jersey and its residents.
